Regulatory Alerts2024-02-29 | CBE4.1.7Added · Updated
CBE Regulation Book 4.1.7 - Controls Related To Financial Leasing
The Central Bank of Egypt mandates that banks limit their exposure to financial leasing companies to 5% of their own funds for general exposure and 1% for exposure to a single company. Banks must ensure that the total exposure to financial leasing companies does not exceed 10% of their own funds and that these companies maintain adequate liquidity by holding at least 10% of their total assets in liquid forms. Additionally, banks are required to monitor the liquidity of leasing companies, ensure they do not exceed 100% of their own funds in leasing assets, and verify that leasing companies do not exceed 10% of their own funds in exposure to a single lessee. These controls apply to new facilities from the date of the circular, with existing excess exposures to be reduced gradually and corrected within three months.
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